How can a consultant find work right now?

Dear Bob,

I’ve been a successful consultant and entrepreneur for over 25 years. In the current recession, I’m seriously underemployed. None of my existing customers want to spend money on consultants, despite my strong track record, and new customers are afraid to commit to a project. It was tough in 2000, but this is even worse.

Any suggestions?

– Running dry

Dear Runner …

It appears we’re both members of the Spare Capacity Club. That being the case, a couple of preliminary points:

1. Why should I help you? If there are clients to be had, I have dibs!

2. If I’m smart enough to answer the question, I’d have no spare capacity.

What follows are my theories, not proven practice. With those disclaimers firmly in place …

I have to divide this into two answers, because “consultant” can either mean “consultant” in its pure sense … as someone who is paid for providing specialized expertise and advice … or what I’d call a “contractor,” who is paid to do actual work.

If you’re a consultant in the pure sense, I have no reliable answers, and I say that as a consultant. What I’m doing at IT Catalysts is adjusting our offerings to be as affordable as possible without paring our actual rates too much. For example, we’re adding “teleconsulting” so we can bill by the hour instead of the day, and avoid having travel costs to pass along.

And, we’re refocusing a lot of our methodologies to have a stronger cost-management dimension, figuring that’s going to be the primary emphasis of any client that is willing to spend on consulting right now.

We don’t expect this to be a strong revenue year. We’re trying to make it a strong relationship-building year so we can leverage the relationships when things loosen up in 2010 (I’m an optimist). So our sales pitch is, “Whatever you have to spend, we’ll provide more than enough value in return to make spending it with us a worthwhile investment.”

If you’re a contractor, my best advice is to keep yourself in front of every contact you have. A lot of companies are shrinking headcount more than they should right now. Later this year, some will recognize they don’t have enough staff to get obligatory work done. When they do, you want them to think of you first.

You also might consider taking on fixed-bid work. If, for example, you’re a top-notch developer you might figure you can knock out a piece of code in a fifth the time a more average programmer might take. Fixed-bid it assuming you’d knock it out in a third the time. You’ll do well and your clients will figure they’re saving both money and risk.

As a contractor your sales pitch right now is, “If you’re going to spend it anyway, you’re best off spending it with me — you’ll get more for less.”

My guess is that right now is as bad as it’s going to get. I don’t mean in terms of employment, which will probably get worse before it gets better. I don’t mean in terms of the DJIA, either … that’s going to be chaos for quite awhile to come.

What I mean is that right now is (I hope) the point of maximum uncertainty. Uncertainty is what causes decision-makers to keep their heads down, taking as few risks and spending as little cash as they can.

When business leaders start to see a more reliable pattern for the future emerging, contracting and consulting dollars will start to be spent again. Not in large amounts, but at least we’ll see something of a thaw.

What we both need to do is position ourselves so we can catch a few drops when the thaw starts to happen.

– Bob